Perhaps IBM's late entry into the blade market will be worth the wait. The vendor revealed its strategy last week, including plans to offer blades that could drastically cut storage costs.

IBM will start selling its server, networking, and storage blades, dubbed the eserverBladeCenter line, in the fall. It plans to include software to help customers manage E-mail and other applications, including those from SAP and Siebel Systems Inc., on the plug-in blades. IBM is behind competitors in shipping server and networking blades, but it's the first of the big storage vendors, including EMC Corp. and Hitachi Data Systems, to offer storage blades, a scaled-down storage system in terms of size and functionality--at least initially.

IBM is building the blades without proprietary microcode, embedded components, and specialized tools that are in high-end storage products; it's using Linux and commodity components. The result: IBM's product-storage costs will drop as much as twentyfold, analysts say. How much savings IBM will pass on to customers is yet to be determined.

The first release of the storage blades will support any SAP R/3 module. But it will take longer to handle mainframe DB2 or Oracle databases, Illuminata analyst Jonathan Eunice says. "There's a next generation of the high-end Enterprise Storage Server based much more around a high-end Unix server architecture, but we might not see it until 2004," he says.

As with other blade systems, multiple apps reside on a single rack in the data center. Customers also can set policies for IBM's blades so they manage themselves. For example, they can automatically download upgrades or warn IT managers when drives start showing signs of defects.

IBM this week plans to boost its iSeries line with the debut of the 890 server, which will contain up to 32 IBM Power 4 processors, up from 24. The 890 also will come with the same self-managing software that the blade servers will get. With 16 processors, the 890 is priced at $1.6 million. Oriental Trading Co., the $500 million party-favor maker in Omaha, Neb., is doing fine with the two 12-processor iSeries servers it runs now. "But we'll be looking at server consolidation next year," says Bob Cargill, systems engineering manager. "And we'll have to consider the 890."

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